New Delhi July. From around 600BC. Corporate Citizenship and Responsible Business can be seen in the business sector over the years. The concept of parting with a portion of one's surplus wealth for the good of society is neither modern nor a Western import into India. women's emancipation and rural reconstruction. Corporate Affairs Ministry of Corporate Affairs
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. 2011
Murli Deora Union Minister. Environmental and Economical Responsibilities of Business being brought out by the Ministry of Corporate Affairs will strengthen this Indian tradition and the Indian corporate sector will evolve into a global leader in responsible business.Murli Deora Union Minister. I am sure the National Voluntary Guidelines on Social. Also. this strong tradition of charity in almost all the business communities of India has acquired a secular character. many of India's leading businessmen were influenced by Mahatma Gandhi and his theory of trusteeship of wealth contributed liberally to his programmes for removal of untouchability. Corporate Affairs Ministry of Corporate Affairs
MESSAGE
Business involvement in social welfare and development has been a tradition in India and its evolution from individuals' charity or philanthropy to Corporate Social Responsibility. the merchant was considered an asset to society and was treated with respect and civility as is recorded in the Mahabharata and the Arthashastra. Over the centuries.

The National Voluntary Guidelines on Socio-Economic and Environmental Responsibilities of Business brought out by the Ministry of Corporate Affairs will help the Corporate sector in their efforts towards inclusive development. P. The Corporate Sector must now focus its attention on achieving the 'triple bottom line'.
New Delhi July. Corporate Affairs Ministry of Corporate Affairs
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. the Corporate Sector is now trying to ensure that economic growth is socially and environmentally sustainable. Corporate Affairs Ministry of Corporate Affairs
FOREWORD
The Corporate Sector around the world is struggling with a new role.P.N. Singh Minister of State. which is to meet the needs of the present generation without compromising the ability of the next generation.people. Businesses now have to take responsibility for the ways their operations impact society and the natural environment. Urged by the Prime Minister's Ten Point Charter.R. planet and profit.N. 2011
R. Singh Minister of State.

D. our planet and our ability to sustain the levels of holistic development that we all aspire to. decision-making. Keeping in view the feedback from stakeholders.
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. This realization has also brought an increasing concern amongst all stakeholders. Specifically. it was decided to revise the same with a more comprehensive set of guidelines that encompasses social. the trajectory of overall growth and development takes a positive turn. environmental and economic responsibilities. Such a responsible approach on part of the business duly supported by the Government alone would secure our future and ensure that wholesome benefits accrue to people. environmental and economical responsibilities of business. and balance these different considerations in an ethical manner. businesses also have significant and long-lasting impacts on people.K. there is growing awareness that in an increasingly complex world. Mittal Secretary Ministry of Corporate Affairs
PREFACE
The importance of businesses in improving the quality of life is well recognized. even as businesses continue to make surpluses that can be re-invested for the growth of the economy. However. The Ministry of Corporate Affairs had released Voluntary Guidelines on CSR in 2009 as the first step towards mainstreaming the concept of Business Responsibilities. and our planet. this calls for businesses being thoroughly aware and conscious of their social. who are demanding that businesses of all types and sizes need to function with fairness and responsibility. When businesses are supported by appropriate Government policy regime that encourages systematic movement towards responsible thinking. and a progressive movement towards sustainability.

the Guidelines use the terms 'Responsible Business' instead of Corporate Social Responsibility (CSR) as the term 'Responsible Business' encompasses the limited scope and understanding of the term CSR. they take cognizance of the fact that all agencies need to collaborate together.K. and provide a distinctively 'Indian' approach. norms and frameworks. The Guidelines take into account the learnings from various international and national good practices.The Guidelines emphasize that businesses have to endeavour to become responsible actors in society. to ensure that businesses flourish. while becoming a powerful global economy by 2020. which will enable businesses to balance and work through the many unique requirements of our land.
New Delhi July. so that their every action leads to sustainable growth and economic development. Mittal Secretary Ministry of Corporate Affairs
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. Accordingly. even as they contribute to the wholesome and inclusive development of the country. By virtue of these Guidelines being derived out of the unique challenges of the Indian economy and the Indian nation. The Guidelines emphasize that responsible businesses alone will be able to help India meet its ambitious goal of inclusive and sustainable all round development. 2011
D.

Mandate and process: These Guidelines have been developed through an extensive consultative process by a Guidelines Drafting Committee (GDC) comprising competent and experienced professionals representing different stakeholder groups. but that they encourage and support their vendors. sector or location and therefore touch on the fundamental aspects – the 'spirit' . Businesses are therefore encouraged to ensure that not only do they follow the Guidelines for areas directly within their immediate control or within their sphere of influence. have been key partners in the development of this consensus.
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. and are intended to be adopted by them comprehensively.Chapter 1: Introduction to the Guidelines
The Guidelines presented herein are a refinement over the Corporate Social Responsibility Voluntary Guidelines 2009.of an enterprise. Leading trade and industry chambers. It needs to be emphasized that all Principles are equally important and non-divisible – this implies that if a business endeavours to function responsibly. it would have to adopt each of the nine (9) principles in their entirety rather than picking and choosing what might suit them. Businesses are encouraged to move beyond the recommended minimum provisions articulated in the document. and accordingly lays down the basic requirements for businesses to function responsibly. The GDC was appointed by the Indian Institute of Corporate Affairs (IICA) with a clear brief that the Guidelines must provide a distinctively 'Indian' approach. The Guidelines are applicable to all such entities. including multi-national companies that operate in the country. and based on these inputs. The Guidelines also provide a framework for responsible business action for Indian MNCs planning to invest or already operating in other parts of the world. would consciously work towards following the Guidelines. as they raise the bar in a manner that makes their valuecreating operations sustainable. Applicability: The Guidelines are designed to be used by all businesses irrespective of size. thereby ensuring a wholesome and inclusive process of economic growth. received from diverse stakeholder groups across the country have been duly considered. which will enable businesses to balance and work through the many unique requirements of our land. who were represented in the GDC as well as actively engaged in the consultative process. The process that was followed in developing these Guidelines relied heavily upon developing a consensus on various ideas that emerged from various stakeholder groups. it is worthwhile to understand that business boundaries today extend well beyond the traditional walls of a factory or an operating plant and all the way across the value chain. It is expected that all businesses in India. partners and other collaborators across their value chains to follow the Guidelines as well. distributors. For business leaders and managers entrusted with the task of deploying the principles of Responsible Business. This document therefore represents the consolidated perspective of vital stakeholders in India. released by the Ministry of Corporate Affairs in December 2009. Significant inputs. appropriate changes have been made in the original draft Guidelines produced by the Guidelines Drafting Committee.

but are based on practices and precepts that take into account the realities of Indian business and society as well as global trends and best practices adapted to the Indian context.Content and Structure: The Guidelines are not prescriptive in nature. a separate chapter on reporting has been included so that the business entities are not only able to adopt the Guidelines but also to demonstrate the adoption to their stakeholders through credible reporting and disclosures. the argument that MSMEs do not have the capacity or resources to implement the changes. a section has also been included on developing Management Systems and Processes for responsible business. MSMEs would lose out on future business opportunities and their ability to remain viable and socially relevant. The suggested framework takes into account the requirements of the business entities that are already reporting in other recognized frameworks as well as those which yet do not have the capacity to undertake full reporting. and Indicators that businesses can adopt to self-steer and regulate their journey towards becoming sustainable and responsible businesses. A reading of each Principle. The reporting framework is designed on the 'Apply-or-Explain' principle which is also the fundamental basis of these Guidelines. Finally.
The Guidelines have been articulated in the form of nine (9) Principles with the Core Elements to actualize each of the principles.
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. The Processes focus on changes in leadership and the leadership structure in the organization. increase their ability to attract and retain talent and manage their relations with investors and society at large. improve their reputations. small and medium enterprises (MSMEs) can be encouraged to adopt the Guidelines. The adoption of these National Voluntary Guidelines will improve the ability of businesses to enhance their competitive strengths. has been juxtaposed with the idea that without a conscious effort to adopt the Guidelines. Since these Guidelines are applicable to large and small businesses alike. a special section has also been included on how micro. It urges businesses to embrace the “triple bottom-line” approach whereby its financial performance can be harmonized with the expectations of society. these are not exhaustive. To assist implementation.
While a broad list of Indicators has been provided to enable businesses to monitor their own implementation process. the environment and the many stakeholders it interfaces with in a sustainable manner. These Guidelines have been drafted in a way that makes them easy to comprehend and implement. with its attendant Core Elements. continuous basis. should provide a very clear basis for putting that Principle into practice. the integration of the Principle and Core Elements into the very business purpose of the organization and ensuring that engagement with stakeholders happens on a consistent. Typically. but sufficiently representative to give a clear idea of the direction that businesses have to take in the implementation of these Guidelines.

Businesses should report on the status of their adoption of these Guidelines as suggested in the reporting framework in this document. The principle acknowledges that business decisions and actions. Transparency2 and Accountability3
Brief Description The principle recognizes that ethical conduct in all its functions and processes is the cornerstone of responsible business. 6. The principle recognizes that the behavior. The principle emphasizes that businesses should inform all relevant stakeholders of the operating risks and address and redress the issues raised. Businesses should develop governance structures. including those required to operationalize the principles in these Guidelines should be amenable to disclosure and be visible to relevant stakeholders. and promote the adoption of this principle across its value chain 2. procedures and practices that ensure ethical conduct at all levels. Businesses should avoid complicity with the actions of any third party that violates any of the principles contained in these Guidelines
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. 5. Core Elements 1.Chapter 2: Principles and Core Elements
Principle 1: Businesses should conduct and govern themselves with Ethics1. Businesses should truthfully discharge their responsibility on financial and other mandatory disclosures. Businesses should communicate transparently and assure access to information about their decisions that impact relevant stakeholders 3. decision making styles and actions of the leadership of the business establishes a culture of integrity and ethics throughout the enterprise. or anticompetition 4. Businesses should not engage in practices that are abusive. corrupt.

The report is an A+ report and is externally assured by third party assurance providers. This sub-committee uses a variety of sources of information to ascertain the state of ethics. government and community as part of its reporting process. as a part of strengthening its ethical functioning. publicly traded Indian enterprise providing a variety of products and services to both domestic and international consumers relies heavily on its global supply chains for a variety of inputs to its business.
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. One of India's oldest (operational since 1910) private sector companies released its first Sustainability Report in 2005 and continues to do so annually based on the Global Reporting Initiative (GRI) Guidelines. The company has created sustainable mechanisms to identify and consult with the key internal and external stakeholders including shareholders. Furthermore. the company has also decided to separate the positions of Chairman and that of Managing Director. including decisions taken by its top management. Vendors. pre-scheduled meetings and key senior executives are regularly invited for interactions. suppliers. social and governance aspects is considered to drive improvements in their performance. Laying the foundations of development Reporting by businesses on environmental. transparency and governance in the business. has formed an Ethics Subcommittee of the Board that is empowered to investigate all matters of suspected violation of ethical standards of the company. The company.Managing Ethics in the Workplace – Key to Good Governance A well-run. the duly appointed Ethics Counsellors of the company regularly interact with members of the sub-committee in formal. For instance. employees. farmers. randomly identified employees. The company holds focus group discussions with the villagers taking cognizance of their needs while developing its community investment programmes. in its endeavour to be responsible. The ethics sub-committee thereby provides the Board with valuable feedback for continuously improving its governance systems. Union officials and other stakeholders of the business are encouraged to meet or write to the sub-committee. customers.

Principle 2: Businesses should provide goods and services that are safe and contribute to sustainability11 throughout their life cycle12 Brief Description The principle emphasizes that in order to function effectively and profitably. 5. Businesses should raise the consumer's awareness of their rights through education. and other forms of intellectual property. Businesses should recognize that over-consumption results in unsustainable exploitation of our planet's resources. incorporating social. Businesses should regularly review and improve upon the process of new technology development. ethical. appropriate and helpful marketing communication. businesses should ensure that the manufacturing processes and technologies required to produce it are resource efficient and sustainable. In designing the product. deployment and commercialization. 2. businesses should work to improve the quality of life of people. customers and recyclersare aware of their responsibilities. producers. full details of contents and composition and promotion of safe usage and disposal of their products and services. right from design to final disposal of the goods and services after use. The principle.designers. Core Elements 1. 6. exhorts them to extend their processes to cover the entire value chain – from sourcing of raw materials or process inputs to distribution and disposal. should engineer value in their goods and services by keeping in mind these impacts. and environmental considerations. therefore. 4. The principle recognizes that all stages of the product life cycle. value chain members. Responsible businesses. 3. Businesses should recognize and respect the rights of people who may be owners of traditional knowledge. while appreciating that businesses are increasingly aware of the need to be internally efficient and responsible. have an impact on society and the environment. and should therefore promote sustainable consumption. Businesses should assure safety and optimal resource use over the life-cycle of the product – from design to disposal – and ensure that everyone connected with it. product labelling.
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. including recycling of resources.

The device even has a feature which reminds the user to unplug their phone charger from the electric socket when the battery has been charged. By offering to take back old devices at all its operating sites. putting energy and valuable materials back into circulation. By providing Eco applications and services. like offsetting CO2 emissions. to support product development and monitor that the quality. sustainable use of materials and smart packaging. and to ensure that the Company Supplier Requirements and related environmental and ethical standards are met. the company is striving to practice recycling and reusing of materials.
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. safety and environmental requirements are met through a series of milestone reviews. During product creation the company (guided by Life Cycle Assessment) focused on energy efficiency. it increases awareness of environmental choices and promote sustainable actions. Effective end-of-life practices close the lifecycle loop. Packaging specialists work to minimize the materials and logistics burden: every product ships in a smaller box compared to its earlier equivalents.Cradle to Grave The company has played a pioneering role in the growth of cellular technology in India. The company has recently offered take-back schemes in all its operating sites. There is a dedicated Design for Environment (DfE) specialist for every product and site. The company's sourcing managers are in constant dialogue with suppliers to confirm full material information and compliance of every single component and module.

They should promote employee morale and career development through enlightened human resource interventions. 8. race. disability or sexual orientation. Business should communicate this provision to their employees and train them on a regular basis. Businesses should take cognizance of the work-life balance of its employees. Businesses should create systems and practices to ensure a harassment free workplace where employees feel safe and secure in discharging their responsibilities. collective bargaining. Businesses should provide facilities for the wellbeing of its employees including those with special needs. religion. hygienic humane. 7. including sub-contracted and home based work. and which upholds the dignity of the employees. and provide access to appropriate grievance redressal mechanisms. Businesses should ensure continuous skill and competence upgrading of all employees by providing access to necessary learning opportunities. 2. Businesses should not use child labour. forced labour or any form of involuntary labour. 4.
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. on an equal and non-discriminatory basis. Businesses should respect the right to freedom of association. Businesses should provide a workplace environment that is safe. 3. 6. Businesses should provide and maintain equal opportunities at the time of recruitment as well as during the course of employment irrespective of caste.Principle 3: Businesses should promote the wellbeing19 of all employees Brief Description
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The principle encompasses all policies and practices relating to the dignity and wellbeing of employees engaged within a business or in its value chain The principle extends to all categories of employees engaged in activities contributing to the business. 5. within or outside of its boundaries and covers work performed by individuals. paid or unpaid. Core Elements 1. They should ensure timely payment of fair living wages to meet basic needs and economic security of the employees. gender. creed. especially that of women. participation.

tea bags. internal HR and other employees have been co-opted in this journey as Master Trainers and Peer Educators who are taking out time from their full time jobs to educate employees. Middle East. operating in India. Ireland. packets. the company has implemented a health awareness initiative to generate knowledge and improve awareness levels of their employees. Canada. cartons and boxes to the USA. and extended communities.' And is the first product in the world to combine branding and advocacy to promote the principles of responsible business via product packaging. Assuming responsibility. exporting more than 4 million kilograms of tea in bulk. Australia. Holland. Japan. Malaysia and Commonwealth of Independent States (CIS) countries has achieved a world first with the launch internationally of a unique new range of single origin and blended teas positioned as 'The Ethical Tea Brand of the World. New Zealand. which is similar to the weight given to any achievement on business results. taking lead One of the branded tea exporters in Sri Lanka. business partners.000 worker families on 27 plantations. Italy. spouses. They strongly believe that addressing health issues significantly contributes to the sustainability of their business operations and especially the health and welfare of their employees. Germany. health and safety. It also carries weight in the annual performance appraisal process. South Korea. community capacity building and empowerment of youth. England.Employee Health and Wellness Programs: Developing an Operating Plan A food and beverage company. The Company initiated this programme in June 2006 with a view to make a difference to the lives of its estate community and to focus on areas such as living environment. a share of the proceeds will be allocated towards improving the living conditions of 11. The claim to be the ethical teas of the world is backed by a distinct facet 'A Home for Every Plantation Worker Programme' under which the company has pledged that for every pack of tea sold globally. For this. Singapore.
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. believes that its employees are its greatest strength and a healthier and happier employee can deliver great results for the long term. Switzerland. The entire approach of the company's initiative is unique in espousing the 'Each One Teach One' approach wherein besides capability building of selected employees and four NGOs in each of the regions.

on-one consultations with business and function heads. Core Elements 1. Businesses should resolve differences with stakeholders in a just.Principle 4: Businesses should respect the interests of. define purpose and scope of engagement. and be responsive towards all stakeholders.g. Businesses should systematically identify their stakeholders. especially those who are disadvantaged. while appreciating that all stakeholders are not equally influential or aware. The process included detailed formal one. Businesses should give special attention to stakeholders in areas that are underdeveloped. customers. The Principle. vulnerable and marginalised30. encourages businesses to proactively engage with and respond to those that are disadvantaged. Based on this process. the company retained the services of a consulting company specializing in stakeholder engagement to work on this task. decisions. In the past. fair and equitable manner
The Changing Face of Stakeholder Engagement without limits An Indian chemical company has always been committed to working closely with its stakeholders. investors and the government. it had identified its key stakeholders through informal consultations with its businesses and involving its managing director in discussions with the critical external ones e. Brief Description The principle recognizes that businesses have a responsibility to think and act beyond the interests of its shareholders to include all their stakeholders. and commit to engaging with them 2. the executive committee and select board members as well as focus group discussions with employees and the good practices followed by leading global and Indian companies. Businesses should acknowledge. assume responsibility and be transparent about the impact of their policies. the major external stakeholder categories were identified as
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.To further embed the process and make it more objective. 4. understand their concerns. product & services and associated operations on the stakeholders 3. vulnerable and marginalized.

The training centre aims at training about 1000 youths per annum under each of the six established Institutes. improved productivity. Within each category. Laying the foundations of development An Indian company in the engineering and construction sector demonstrated the business case for social responsibility by integrating its skilled manpower requirements to imparting of skills to the local rural youths hailing from economically weaker section who usually do not have scope for higher education. better quality of finished product. human rights and consumer rights NGOs both local and national). which could not be rectified by many internal and external experts. industry associations. The activists asked the workers. labour contractors and packers). Students passing out were absorbed in their respective skill category with work experience on site. The issue of regular breakdown of the boiler cropped up in the discussion. It has also resulted in reduction in wastages. individual organisations were identified through discussions with the company staff as well as with external interlocutors to ensure that a wide range of opinions were available. Post training. All assistance was given by way of close monitoring and interfacing with training institutes. besides earning a huge foreign exchange by way of migration of skilled manpower for overseas jobs.. Through the above intervention the company served as a role model to impart construction skills training and has now become a mass movement. investors. Engaging Safety An electricity company based in Baroda was facing regular breakdown of one of its boilers. regulators) and Civil Society (environmental. This helped the unemployed youth not only with a sustainable employment but a career progression depending upon their performance. government. The company was visited by a group of workers' activists to have a discussion with the workers and shop floor supervisors on the safety culture. which is benefiting the society both in terms of skills development and providing employment. The company proposes to use this process to set up a formal stakeholder panel that it will engage with on an ongoing basis. reduction in injuries / accidents. The workers replied that they have been working with the boiler for years and they can
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. Opinion Makers and regulators (media. if they have any solution. the skilled technicians were deployed under sub-contractors of the company in various job sites across the country.Business Partners (customers.

high wastage due to spillage and accidents. In the course of informal discussions with the management it came out that the company had quality issues. Enabling community chemistry A medium sized foundry was visited by a group of workers' activists to appraise them about the work culture. A broad survey was undertaken on the loss to the company due to the above stated practices.repair it if given a chance. The environment was full of heat and dust. A group of select workers used available material and reworked on the problem and eventually it was ratified. participation and collective decision making process. The workers' activists provided input on the technical aspects to this group. gloves or goggles. In the end workers got motivated and participated in a joint exercise with management to improve the work culture. shoes.rates came down but also profit started showing up. The workers' activists called a meeting with workers and shop floor supervisors to seek their opinion on the state of affairs and elicit their interest in improving the situation. not only did the production improve due to less breakdown of machinery but absenteeism also went down due to the dust free and clean environment. By the end of the financial year not only did the accident rates came down but also profits started to show. The workers' activists negotiated with the management. Through case studies and presentations the group was provided input on the importance of safety. The gas cylinders were tilted to extract every last drop of gas and even accidents were not reported to the Factory Inspector by mutual consent between the workers and the management. Eventually. It found that in spite of being a dangerous workplace none of the workers were using any safety equipment like helmets.
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. This group by themselves conducted a raw form of safety audit of the plant and suggested some changes in the housekeeping and dust control methods. The management was quite impressed and decided to form a workers group called “Safety Circle” to advise them on work processes and safety related issues.

cultural and social rights. the principle is in consonance with the Universal Declaration of Human Rights. these have evolved under the headings of civil. Businesses should not be complicit with human rights abuses by a third party. Remedy” Framework. Businesses should. The principle imbibes its spirit from the Constitution of India.
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. economic. indivisible and interdependent in nature 2. India played an active role. enshrines the achievement of human rights for all its citizens. 3. Businesses should appreciate that human rights are inherent. Over the decades. Respect. Core Elements 1. within their sphere of influence. This holistic and widely agreed nature of human rights offers a practical and legitimate framework for business leaders seeking to manage risks. Businesses should recognize and respect the human rights of all relevant stakeholders and groups within and beyond the workplace. The principle takes into account the “Corporate Responsibility to Respect Human Rights”. including that of communities. as referred in the United Nations “Protect. consumers and vulnerable and marginalized groups. in particular through assessing and managing human rights impacts of operations.Principle 5: Businesses should respect and promote human rights Brief Description The principle recognizes that human rights are the codification and agreement of what it means to treat others with dignity and respect. which through its provisions of Fundamental Rights and Directive Principles of State Policy. universal. 5. in the formation of which. Businesses should integrate respect for human rights in management systems. In addition. and ensuring all individuals impacted by the business have access to grievance mechanisms. national laws and policies and the content of International Bill of Human Rights. promote the awareness and realization of human rights across their value chain. Businesses should understand the human rights content of the Constitution of India. political. 4. seize business opportunities and compete in a responsible fashion.

The company encourages people with disabilities to apply for positions with them and have suitably advertised: 'Persons with disability are encouraged to apply”. Reaching out to 36 000 girl children is the company's biggest success. having necessary skill sets to work in a BPO environment. customers. The programme has increased ten-fold in the past two years and has therefore achieved expected results. information and infrastructure development. Solutions that touch lives Of the some 70 million persons with disabilities in India (5-6 percent of India's population). including the financial services. This is one of the causes of reduced attrition level since employees want to associate themselves with an organization that gives itself to the community. trade and logistics. This has also enhanced the company's image among its key stakeholders. A Business Process Outsourcing (BPO) company recognized the need and proactively tapped different talent pools including hiring people with physical disability.Nurturing Development An industrial house in India with a presence in key sectors of the Indian economy. The unique objective of this initiative was to provide gainful employment to persons with disabilities without compromising on the quality. employees. and others. They also organise special recruitment drives solely targeted at increasing the representation of persons with disability among the workforce. automotive components. started a project in the year 1996 with a focused approach to provide primary education to the underprivileged girl child from economically disadvantaged strata of society. only a handful have succeeded in obtaining employment. They have developed specific standard recruitment/induction process to
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. the company's Education Trust entered into partnership with the state government and a leading NGO working in the education sector so as bring together the finest professionals and the government authorities. To take the project to scale and provide 10 years of quality education to the girl child. including its shareholders.

The company experienced a lowest attrition rate of 34. special low floor cabs. The association. The Association supports governmental efforts in establishing and running schools for the emancipated children and others from the vulnerable section. Working for change A collective action of 32 SMEs of a well known manufacturing and exports association has ensured elimination of “Child Labour” from their operations which were largely decentralized. Further. This includes sensitization of team members of hearing impaired employees. Through their efforts they have ensured that children who are emancipated from child labour do not go back to work and stay in school. as required.
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.79% compared to the industry attrition rate of 70%. with support from its members also ensures alternative income and access to finance to the beneficiary family by encouraging Self Help Groups and other Microfinance tools. it facilitates tuition centres ensuring rehabilitation to the emancipated children. sign language interpreter.ensure that persons with disability are inducted well into the company and provide the required assistance to them. and emergency preparedness plan etc to meet the needs of persons with disabilities. they have ensured sustainability of the project by engaging all stakeholders and addressing their needs. Through their efforts. They provide requisite facilities like ramps. and other special training. accessible washrooms.

The Principle urges businesses to follow the precautionary principle and not go ahead with a particular action if it is unsure of its adverse impacts. and make efforts to restore the environment Brief Description The principle recognizes that environmental responsibility is a prerequisite for sustainable economic growth and for the well being of society. Businesses should continuously seek to improve their environmental performance by adopting cleaner production methods.
5. recycling and managing waste.
4. including the assessment of potential environmental risks associated with their operations. They should assess the environmental damage and bear the cost of pollution abatement with due regard to public interest.
. Businesses should proactively persuade and support its value chain to adopt this principle
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2. Businesses should ensure that benefits arising out of access and commercialization of biological and other natural resources and associated traditional knowledge are shared equitably. The principle encourages businesses to understand and be accountable for direct and indirect environmental impacts of their operations.Principle 6: Business should respect.
7. biodiversity conservation and climate change in a comprehensive and systematic manner. which may be caused due to their operations or that of a member of its value chain Businesses should report their environmental performance. Businesses should take measures to check and prevent pollution. reusing.
6. Core Elements 1. regional and global levels which makes it imperative for businesses to address issues such as global warming. products and services and to strive to make them more environment friendly. to the stakeholders in a fair and transparent manner.
3. promoting use of energy efficient and environment friendly technologies and use of renewable energy Businesses should develop Environment Management Systems (EMS) and contingency plans and processes that help them in preventing. Businesses should utilize natural and manmade resources in an optimal and responsible manner and ensure the sustainability of resources by reducing. protect. mitigating and controlling environmental damages and disasters. The principle emphasizes that environmental issues are interconnected at the local.

a 25% reduction in the effluent generated. like growing of less water intensive crops. the company has undertaken remarkable initiatives for effective utilization of energy resources and minimization & control of waste. The company dealt with the problem from many angles. As a part of its commitment towards sustainable development and conservation of the environment. The bottoms of fresh water wells were sealed so that saline water does not mix with fresh water. • Reduced furnace oil consumption leading to reduction in sulphur emission. • Complete elimination of unrecoverable metals.1 million. use of drip irrigation. This jointly conceptualized and implemented project also received funding assistance from the state government and other funding NGOs. increased agricultural productivity as well. through strategic process innovation in the manufacturing process of Cephalosporin.Linking natural resource management with sustainable development: Creating value for society A cement manufacturing company in the country initiated the salinity mitigation programme in coastal regions of Gujarat to improve the condition of the natural resources available. interlinking water bodies/ ponds. The highlight of the project was in using simple. Under this project. roof rain water harvesting structures were built. • Reduced electricity consumption by 95%. improving productivity by 55%. Initiative towards Eco friendly process: Cleaner is Cheaper A globally recognized integrated pharmaceutical (pharma) company based in Maharashtra with core competencies in the development and manufacture of APIs (active pharmaceutical ingredients) and finished dosage forms. The project has benefited a total of 2181 households across 15 villages by raising the ground water levels in project villages by nearly 30 feet. relatively inexpensive technology along with direct people's participation to solve a serious socioeconomic and environmental problem.
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. has achieved • A 40% reduction in the generation of hazardous waste. • The total savings per annum have been calculated to the tune of INR 2. For provision of drinking water. greater ground water recharge. as well as in drug discovery has been working towards making its process more energy efficient and reducing their environmental impacts. check dams were built to allow water to percolate down. the community members were mobilized for innovative water conservation projects by the company. The company. Modifications in agriculture. promotion of horticulture were encouraged. In areas where a seasonal river flowed.

must ensure that their advocacy positions are consistent with the Principles and Core Elements contained in these Guidelines. which guide their growth and also provide for certain desirable restrictions and boundaries.Principle 7: Businesses. The principle acknowledges that in a democratic set-up. businesses should utilize the trade and industry chambers and associations and other such collective platforms to undertake such policy advocacy. The principle. recognizes the right of businesses to engage with the Government for redressal of a grievance or for influencing public policy and public opinion. when engaged in influencing public and regulatory policy. including businesses. Businesses. Core Elements 1. such legal frameworks are developed in a collaborative manner with participation of all the stakeholders. in that context. To the extent possible.
2. while pursuing policy advocacy.
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. should do so in a responsible manner Brief Description The principle recognizes that businesses operate within the specified legislative and policy frameworks prescribed by the Government. The principle emphasizes that policy advocacy must expand public good rather than diminish it or make it available to a select few.

Businesses operating in regions that are underdeveloped should be especially sensitive to local concerns. vulnerable and marginalised sections of society.Principle 8: Businesses should support inclusive growth and equitable development Brief Description The principle recognizes the challenges of social and economic development faced by India and builds upon the development agenda that has been articulated in the government policies and priorities. and assure appropriate resettlement and rehabilitation of communities who have been displaced owing to their business operations. and respond through appropriate action to minimise the negative impacts. Businesses should understand their impact on social and economic development. especially to that of the disadvantaged. 3. Businesses should innovate and invest in products. Businesses should make efforts to complement and support the development priorities at local and national levels. 2. The principle reiterates that business prosperity and inclusive growth and equitable development are interdependent. technologies and processes that promote the wellbeing of society. The principle recognizes the value of the energy and enterprise of businesses and encourages them to innovate and contribute to the overall development of the country. The principle also emphasizes the need for collaboration amongst businesses. 4. government agencies and civil society in furthering this development agenda.
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. Core Elements 1.

and 9 million plus in 2007/08. The company paid an amount of Rs 500 000 towards the corpus fund of Bunkar Vikas Sanstha. Rs 3. The company had associated with this project since 2004 and the following achievements have been made: • • • Sales turnover is growing from Rs 0.
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. non farm sector loan and general purpose loan for consumption need etc. financial services were proposed through the Apna Kosh and the company provided Rs 500 lakh as seed money to Apna Kosh. which offers credit services for agriculture loan. To strengthen the handloom based livelihoods in the area. This initiative has been facilitated by a voluntary cross functional CSR arm of the company. which has direct sales (other than assured institutional sales) of more than 30%. and empowering the weavers by providing financial support for promoting the products in the market. agri-allied loan. seeking support for preserving the dying art of traditional weaving. The company decided to undertake this project of reviving the dying art through organizing the community. Business plan of 2007/08 was for Rs 15 million.Entrepreneurial Development Project to Recreate a Lost HeritageA leading oil and gas sector company came across a proposal from the state government authorities in 2004.7 million in 2003/04. volunteers willing to donate time to the needy. Forty self-help groups with good overall track record of microfinance were short listed for the proposed CBMFI (community-based microfinance institute)
Principle VIII (Inclusive Growth – MSME caselet) Title: Creating Value for Society A service sector SME providing outsourced product engineering has created learning opportunities for the under privileged children in two cities where it operates by establishing partnerships with local NGOs. The company while utilizing its core competencies in product solutions has involved itself with a renowned Chamber of Commerce which brings together. arranging a corpus fund for sustainable livelihood. Through the use of ICT services along with a programme on Computer Literacy.3 million in 2004/05. they offer a range of tailored courses on IT and its applications. Rs 7 million plus in 2005/06.

local financial institutions. which helped in integrating the programme with the overall business operations at the plant. till 2008. taxation.5 crores INR have been awarded to the 29 micro-vendors and many have even secured contracts from other corporations in the region due to their experience with the company. quality control and assurance. Since 2005. with its core strengths in oil and gas exploration has been undertaking sustainable development initiatives to address the village communities' livelihood concerns. capacity building. with the aim of building the capacities of the local communities to aid the company's supply chain and in turn. village Panchayats. It launched the micro-vendor development programme.
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. contracts worth over 4. and cost competitiveness. The company is now reaching out to set up an industrial and vocational training centre to equip the local youth with skill sets for better livelihood opportunities. The programme has created an impact in developing awareness among the local community on the importance of higher education. and development of entrepreneurship have led to the programme achieving success and sustainability. Factors such as market oriented approach rather than altruism and philanthropy. Consultations and stakeholder engagement processes were carried out with community members. The tender process was carried out under the guidance of the CR team and contracts were awarded to the most competitive bids. district administration. help the village benefit from the programme. to ensure stakeholder participation. It has further facilitated mainstream education among students of a local Madarsa run by the company. As a ripple effect of the programme. Willing entrepreneurs were provided training and capacity building on financial planning. jobs were created. in addition to appropriate training.Taking the community along: Micro-Vendor Development Programme The company. Towards a better tomorrow A food manufacturing and processing SME provides free education to the under privileged children of the local community in a remote and backward district of Maharashtra through the Urdu High School built and run by the enterprise. A cross-functional CR team was set up to provide technical assistance and advisory services to local entrepreneurs. bookkeeping.

multispecialty camp. thereby improving the condition of the underprivileged community. including the hospital staff. made an assessment in the villages and an action plan was accordingly prepared for the next five years. and typhoid was made available to children and pregnant women. initiated a project called 'Health for All” to provide quality health services to the local community and strengthen the government delivery mechanism. Roundthe-clock medical facilities. life insurance sectors. The dedicated team. Budget allocation was defined on a yearly basis and various other programmes were linked to the project. MMR. polio.Enabling bottom up development An Indian infrastructure Company has adopted the vision to 'build entrepreneurial organizations that make a difference to society through creation of value'.
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. which now act as peer monitoring groups for the community and also generate accountability of service providers to provide health services on a regular basis. including ambulance facility has been made available to the local community. The surveys helped to ascertain the educational and aspirational levels of the youth in the area. The company undertook surveys and 'awareness melas' to reach out to a large number of unskilled and less educated youth including girls in the surrounding villages who were not engaged in any meaningful profession or work. The company was recognized for its efforts in rehabilitating the project affected families by providing vocational training to youth around a newly commissioned metro city airport. family planning camp. The company also initiated partnerships with industry partners to help these young people get jobs. various groups. Under this project. retail. These groups review the health status regularly. immunization against Hepatitis B. During the course of the project. Various training courses started in 2006 when the airport construction work was going on. The company also supported governmentsponsored health facilities in terms of infrastructure and equipment. with a major presence in the metals. such as the village health committee and farmer association were formed. and weekly medical camp were organized. Moreover. The project was designed with participation from the local community. Promoting community health and welfare A company. a mega eye camp. The initiative has employed the youth in the airport project and is now providing technically skilled manpower to other companies and improving the employability of the local youth.

for the benefit of their customers. Businesses should ensure that they do not restrict the freedom of choice and free competition in any manner while designing. businesses should also educate their customers on the safe and responsible usage of their products and services. Where required. 6. Core Elements: 1. Businesses should provide adequate grievance handling mechanisms to address customer concerns and feedback.
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. 3. Businesses should promote and advertise their products in ways that do not mislead or confuse the consumers or violate any of the principles in these Guidelines. and that the enterprises will strive to make available goods that are safe. The principle recognizes that customers have the freedom of choice in the selection and usage of goods and services. The principle also recognizes that businesses have an obligation to mitigating the long term adverse impacts that excessive consumption may have on the overall well-being of individuals. 2. Businesses should disclose all information truthfully and factually. easy to use and safe to dispose off. through labelling and other means. so that the customers can exercise their freedom to consume in a responsible manner. to society and to the planet from the use of the products. should take into account the overall well-being of the customers and that of society. 5. 4. society and our planet. while serving the needs of their customers. competitively priced. promoting and selling their products.Principle 9: Businesses should engage with and provide value to their customers and consumers in a responsible manner Brief Description This principle is based on the fact that the basic aim of a business entity is to provide goods and services to its customers in a manner that creates value for both. including the risks to the individual. Businesses. The principle acknowledges that no business entity can exist or survive in the absence of its customers. Businesses should exercise due care and caution while providing goods and services that result in over exploitation of natural resources or lead to excessive conspicuous consumption.

and thus determine which of these are important to it. they may use a tool called a Business Case Matrix. Integration – These principles and core elements must be embedded in theBusiness policies and strategies emanating from the core business purpose of the organization. This requires. For this to happen. Engagement – Building strong relationships and engaging with stakeholders on a consistent. provided in Annexure A Every business should develop such a matrix for its own context for each Core Element.Chapter 3 : Guidance on Implementation of Principles And Core Elements
Successful implementation of the Principles and Core elements that this Guideline provides require that all of them need to be integrated and embedded in the core business processes of an enterprise. these must align with each business's internal values and/or must provide clear business benefits. The board and senior management need to ensure that the principles are fully understood across the organization and comprehensively executed.
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. specifically that the following actions are taken: Leadership – The Chairman/CEO/Owner-Manager should play a proactive role in convincing the board/Top Management and staff within the business that adopting these principles is crucial for success.
Determining the Business Case It is critical for each business to assess how adoption for these Guidelines will provide a business benefit – in the short term as well as in the long term. To help businesses determine this. Reporting: Implementation process includes disclosure by companies of their impact on society an environment to their stakeholders. continuous basis is crucial.

Figure 1 Adopting the Guidelines: A Suggested Approach
Business’s Vision Mission and Values
Current laws and regulations
National Voluntary Guidelines for Responsible Businesses
Higher Priority
Step1: Which of the core Elements are important to the Business ?
Lower Priority
Step 2: Determine ambition for each Principle Essential level Leadership level
Ensure that all legal requirements are complied with
Step 3: Define** BR Policy Adoption of Indiactors for Principle and core Element
Priority may be determined by their alignment with internal values and business benefits. Thus. and this is non-negotiable. their minimum performance with respect to these has to be full compliance with these laws and regulations of the country. even if a business finds that some Core Elements are not important for it. It may be noted that the Guidelines assume that compliance with the laws of the land is necessary for a business to operate. The latter may be determined using the Business Case Matrix described in the next section.Adopting the Guidelines: A suggested approach The flowchart in Figure 1 suggests an approach that a business can take to adopt these Guidelines.
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. ** The RB Policy and Indicators are crucial in determining the RB Strategy. The steps to develop such a strategy are outlined later in this chapter.

these principles need to be incorporated into a Strategy for Responsible Business.Developing a Strategy for Responsible Business To begin with. The diagram below (Figure 1) outlines the six generic steps in building and executing such a strategy:
Figure 2 Six Steps for Building A Strategy for Responsible Business (RB) Steps Towards Responsible Business
Step1-Analyse Your Business Key Business Drivers Opportunities and Threats Strengths and Weakness Articulate the RB Policy
Step 6-Communicate Convey Rationale Listen Embed in Communications Report Step 5-Monitor & Review Progress Monitor Measure Learn and Refine Processes Step 2-Identify Risks and Opportunities Identify Issue Network prioritise
Step 4-Plan & implement Strategy Roadmap Clear Objective Training ‘Low-hanging Fruit’ Adoption of indicators for each Principle Step 3-Develop a Strategy Operational / Strategic Compliance / Beyond Compliance
Source: Adapted from Developing Value published by Sustainability and International Finance Corporation
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.

Policy deployment and Process management
The business has established a policy related to the Principles and has put into place processes and process owners for implementation. The Indicators are categorized as “Essential” and “Leadership”. The issues related therein are regularly reviewed at the governance level. regular review and guidance.
The business has developed a Code of Conduct or has adopted nationally or internationally recognized Standards/global best practices with respect to the Principles and Core Elements. Businesses are encouraged to develop their own context-specific indicators to suit their unique requirements as they focus on the implementation of the principles. Based on this. These indicators are applicable to all the Principles and Core Elements. these indicators are not exhaustive.
Essential Indicators
Commitment of Top Management and supportive governance structure The top management has developed an understanding of the principles and core elements as well as the issues involved therein and ensured its deployment across the business through appropriate action. the leadership level indicators are expected to be put into place by those businesses which aspire to progress to a higher level in their quest to be socially. environmentally and ethically responsible. the business has an identified strategy along with the relevant processes for implementation of the adopted Codes/Standards/Practices.
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.
Leadership Indicators
There are specified Committees /Sub-Committees in the governance structure responsible for implementation of these Guidelines. However.Indicators Indicators are metrics that enable businesses to self-monitor their progress on implementation of the principles. Indicators have been added as a separate part in the chapter to aid business to implement the Principles and Core Elements contained in these Guidelines and also to enable stakeholders to evaluate the extent of the implementation. While the essential level is expected from every business that has adopted these Guidelines.

processes and methods of stakeholders' engagement.
Analysis and improvement
The business identifies and records critical deviations from the laid down processes and takes them up for corrective actions.
.
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Stakeholder engagement
The business identifies and engages with its priority stakeholders for implementing these Guidelines. All deviations from the laid down processes are recorded.
Continuous innovation
The business engages in continuous improvement keeping the growing expectations of stakeholders in mind. The business discloses its performance. The business systematically identifies all its stakeholders including within its supply chain and engages with them on various aspects of these Guidelines. on various aspects of corporate responsibility. to the wider public.
Disclosure
The business discloses its performance on Principles and core elements to priority stakeholders. The business focuses on innovation in products.Sensitization and training
The business sensitizes its managers and employees through awareness and training so that they are able to understand and work according to the processes laid down above. Where applicable the codes/ standards/practices adopted by the business would be regularly audited. The business undertakes third party assessment. so as to continuously improve its performance on all business processes that impact the principles and core elements.
The business demonstrates its leadership by sensitizing (through regular and systematic training and awareness) not only the employees and managers but all the stakeholders including those within its supply chain as well as outside. analyzed and taken up for process correction as well as mitigation of any loss/damage to the enterprise and its stakeholders. including deviations and corrective actions. verification and impact analysis of its performance on various principles and core elements.
Monitoring and Evaluation
The business undertakes selfassessment and review of its performance on various principles and core elements.

and from the one supplying goods to a next door neighbour. Global buyers are basing their sourcing decisions not only on traditional commercial considerations such as price. A major part of the Indian MSME sector is 'local' in its operations and outlook. Due to the increasing integration of the Indian economy with the global economy. Yet it impacts the environment and society in its own way. Many Indian buyers too are beginning to incorporate these requirements into their purchasing decisions. whereas those that are responsive to these expectations might find new business opportunities opening up for them. health and safety. The enterprises range from an entity having just a single self-employed person to the one employing hundreds of people. the Responsible Business practices need to be grounded in the context within which MSMEs operate in India. particularly the micro enterprises. The Guidelines Drafting Committee has been sensitive to the fact that to be effective and have wider acceptance among MSMEs. Many MSMEs. Small and Medium Enterprises (MSMEs)
Widely regarded as the backbone of the Indian economy. for instance. enterprises of all sizes have been gradually exposed to global competition. MSMEs are defined on the basis of investment in plant and machinery having further different slabs for manufacturing and service units.Chapter 4: Application of Guidelines to Micro. The need for responding to rising social and environmental concerns is being realized increasingly by the MSME sector but the multiplicity of prevailing codes is an impediment. despite the small numbers of its employees. Their business
1 As per the MSME Development Act 2006. The present Guidelines aim to provide coherence in expectations and obviate the need for multiple codes on social and environmental concerns.
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. MSMEs not sensitive to these expectations run a serious risk of isolation and rejection by buyers as well as consumers. quality and delivery commitments. to the one producing high-tech goods for global supply chains. The principles and core elements of these Guidelines are size neutral and are equally applicable to the MSME sector. social equity in employment and production. but also on compliance with social and environmental norms in the workplace. especially during the last decade. may genuinely lack resources and capacity to adopt and integrate the Guidelines. the MSME sector1 is highly diverse and heterogeneous in its structure. and ecological compatibility of products and processes. covering. the localized buyers and the confined surroundings of its place of business. The framework of these Guidelines and the extent to which they are applicable to such a sector needs to be understood in the context of the realities of these enterprises.

The set of essential Indicators.environment may also be discouraging a responsible enterprise. These Guidelines suggest that the Principles and Core elements outlined in this document are integral to business strategy and operations.
Indian MSME Sector at a Glance • • • • • Number Employment Contribution Type Status : 26 Million : 60 Million : 40% to Industrial Production. 45% of Exports. in an MSME may be just the owner. is to facilitate enterprises of all sizes to measure progress of implementation. Hence. But the MSMEs are encouraged to customize the processes and indicators in their unique context.manager or the partner. The board or 'top management'. 9 % of GDP : 97% are partnership or proprietorships : 94% are unregistered
In Industrial growth consistently outperforms large corporate sector by 2%
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. appended with these Guidelines. promoting Responsible Business practices among MSMEs may necessitate a multipronged approach which should include: • Facilitating MSMEs to recognize the business case for adopting Responsible Business practices • Preference by public agencies and large players in value chains to MSME suppliers that follow BR practices • Handholding MSMEs during the adoption of the Guidelines The public agencies as well as large enterprises may catalyze the process further by supporting collective initiatives of the MSMEs in clusters. for example. The capacity of the MSME associations could be built for awareness creation and to carry out collective initiatives.

the Reporting Framework provides a standard disclosure template which can be used by businesses to report on their performance in these areas.Chapter 5: Business Responsibility Reporting Framework
Introduction: The basic aim of these business responsibility Guidelines is twofold. The first category of entities may not prepare a separate report for the purpose of these Guidelines but furnish the same to their stakeholders along with the details of the framework under which their BR report has been prepared and a mapping of the nine principles contained in this Guideline to the disclosures made in their BR reports. These Business Responsibility (BR) reports will also help in identifying some of the best practices that can serve as guidance models. suggests different approaches that may be adopted by the three categories of entities.
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. One of the critical aspects of Responsible Business practices is that businesses should not only be responsible but they should also be seen as socially. it is expected that businesses will also develop a better understanding of the process of transformation that makes their operations more responsible. Through such reporting. they will also be able to encourage their stakeholders to have a more meaningful engagement with the business rather than the often-prevalent one-sided expectational engagement. While the Guidelines encompassing nine Principles and related Core Elements identify the areas where responsible practices need to be adopted. The objective of incorporating this framework in these Guidelines is to help businesses to reach out to their stakeholders with necessary information and data demonstrating the adoption of these Guidelines. In the context of BR reporting. but are not yet fully capacitated to prepare a comprehensive BR report • Business entities that would like to prepare comprehensive reports after adopting these Guidelines The Reporting Framework. accordingly. During the process of reporting. economically and environmentally responsible. firstly to help businesses to use their entrepreneurship to effectively contribute to the economic and social betterment of communities and secondly to make their operations sustainable in a manner that enables them to meet their current needs without compromising the needs of the future generation. it is appreciated that there are three categories of businesses as under: • Business entities already preparing responsibility and sustainability reports based on internationally accepted reporting frameworks • Business entities that have chosen to adopt these Guidelines completely or in part.

For the entities in the third category. This framework identifies certain basic parameters on which the businesses can disclose their performance so as to demonstrate their adoption of these Guidelines in letter and spirit. The Framework has been kept simple so that it also caters to the requirements of the SME sector.The second category of entities may furnish a simple communication to their stakeholders indicating their commitment to adoption on these Guidelines in full or in part. It has been divided into two partsPart A incorporates the basic information about the operations of the business entity so that their BR report can be a self contained document and Part B incorporates the performance indicators for different Principles and Core Elements. While designing this framework the reporting frameworks being used. Such entities are encouraged to see the suggested framework for the third category and upgrade their BR communication on a progressive and continuous basis. The communication may be in a free format and should be signed by the owner/Managing Director of the CEO of the entity. both nationally and internationally. and basic details of the activities undertaken in pursuance to these Guidelines. have been taken into account.
Business entities that are preparing their Business Responsibility and Sustainability Report in a nationally /internationally recognized Framework
Furnish the same Report with a mapping of the Principles of these Guidelines with the disclosures
If not
Business entities that are not fully capacitated to prepare a detailed report on RB practices
Furnish a letter signed by the Owner/ Managing Director/CEO indicating the commitment to the Guidelines and a brief on the activities undertaken
If not
Business Entities that are committed to furnishing a detailed Business Responsibility Report
Furnish a Report on the basis of the framework as given below. the BR reporting framework (see after the flowchart) is suggested.
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national and international. the reasons for not doing so. • Economic and Financial Data – Sales. In case the business entity has chosen not to adopt or report on any of the Principles. Net Profit. The report may be prepared in a free format with the basic performance indicators being included in the same. Tax Paid. if possible. the same may be stated along with. It may be written in a free format incorporating at least the following: A-1 • Basic details of the business – Name. details of the people in top management. number of employees.Business Responsibility Report . products and services offered. Market Capitalization(for listed companies). markets served. A-2 • Management's Commitment Statement to the ESG Guidelines • Priorities in terms of Principle and Core Elements • Reporting Period/Cycle • Whether the report s based on this framework or any other framework • Any Significant Risk that the business would like its stakeholders to know • Any Goals and Targets that were set by the top management for improving their performance during the Reporting Period Part -B Part-B of the report incorporates the basic parameters on which the business may report their performance. Total Assets. B-1 Principle 1 – Ethics. Efforts have been made to keep the reporting simple keeping in view the fact that this framework is equally applicable to the small businesses as well.Suggested Framework Part -A Part A of the report includes basic information and data about the operations of the business entity so that the reading of the report becomes more contextual and comparable with other similarly placed businesses. nature of ownership. Transparency and Accountability
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. location of its operations .

• Internally developed statement on Ethics. • State whether the person/committee head responsible for oversight review is independent from the executive authority or not. • Processes in place for the Board/ Chief Executive to ensure conflicts of interest are avoided. Principle 2 – Products Life Cycle Sustainability • Statement on the use of recyclable raw materials used • Statement on use of energy-efficient technologies. how. Codes of Conduct and details of the process followed to ensure that the same are followed • Frequency with which the Board/ Chief Executive assess BR performance. • Mechanisms for shareholders and employees to provide recommendations or direction to the Board/ Chief Executive. including committees under the Board responsible for organizational oversight.• Governance structure of the business. In case no committee is constituted. then the details of the individual responsible for the oversight • Mandate and composition (including number of independent members and/or non-executive members) of such committee with the number of oversight review meetings held. If yes. designs and manufacturing/ service-delivery processes • Statement on copyrights issues in case of the products that involve use of traditional knowledge and geographical indicators • Statement on use of sustainable practices used in the value chain Principle 3 – Employees' well-being • Total number of employees with percentage of employees that are engaged through contractors • Statement on non-discriminatory employment policy of the business entity • Percentage of employees who are women • Number of persons with disabilities hired • Amount of the least monthly wage paid to any skilled and unskilled employee • Number of training and skill up-gradation programmes organized during the reporting period for skilled and unskilled employees
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• Number of incidents of delay in payment of wages during the reporting period • Number of grievances submitted by the employees Principle 4 – Stakeholder Engagement • Statement on the process of identification of stakeholders and engaging with them • Statement on significant issues on which formal dialogue has been undertaken with any of the stakeholder groups Principle 5 – Human Rights • Statement on the policy of the business entity on observance of human rights in their operation • Statement on complaints of human rights violations filed during the reporting period Principle 6 – Environment • Percentage of materials used that are recycled input materials • Total energy consumed by the business entity for its operations • Statement on use of energy saving processes and the total energy saved due to use of such processes • Use of renewable energy as percentage of total energy consumption • Total water consumed and the percentage of water that is recycled and reused • Statement on quantum of emissions of greenhouse gases and efforts made to reduce the same • Statement on discharge of water and effluents indicating the treatment done before discharge and the destination of disposal • Details of efforts made for reconstruction of bio-diversity Principle 7 – Policy Advocacy • Statement on significant policy advocacy efforts undertaken with details of the platforms used Principle 8 – Inclusive Growth • Details of community investment and development work undertaken indicating the financial resources deployed and the impact of this work with a longer term perspective
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The objective is to encourage the business to report on this aspect in a transparent manner so that it can channelize its efforts to mitigate the same. Part C-1 is a disclosure on by the business entity on any negative consequences of its operations on the social. Part C-2 is aimed at encouraging the business to continuously improve its performance in the area of BR. C-1 • Brief Report on any material/significant negative consequences of the operations of the business entity C-2 • Brief on Goals and Targets in the area of social.• Details of innovative practices. environmental and economic responsibilities that the business entity has set for itself for the next Reporting Period
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. labeling and safe disposal of the products received during the reporting period Part -C Part C of the report incorporates two important aspects on BR reporting. method of use and disposal. • Details of the customer complaints on safety. product and process standards observed. products and services that particularly enhance access and allocation of resources to the poor and the marginalized groups of the society Principle 9 – Customer Value • Statement on whether the labeling of their products has adequate information regarding product-related customer health and safety. environmental and economic fronts.

Safe and sustainable goods and services
Efficiency gains across the value chain – procurement. production distribution. regulators Reduced risk of action from regulators and NGOs
Attract and retain employees
Positively seen by customers. regulators. Sustainable production attracts
Employee morale is high due to working to improve the quality of life of customers/c ommunity Attract and retain employees Reduced tardiness & absenteeism People drawn to work for a sensitive employer
Better brand identity New found USP
3. local governments.
Ethics. media
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. production distribution. banks Attractive to financial markets
Positively seen by communities. media Ehances corporate cache
5. banks Attractive to financial markets
Positively seen by communities.
Responsiveness to all stakeholders
Responsive to customer demands/ needs/ wants leads to increase in market share.
Well-being of employees
Business partner of choice
Increased productivity High morale Less absenteeism
Improved labour relations leading to less disruptions
Employer of choice
4. after-sales
Investors feel assured that liability issues are minimized. local governments. NGOs.
Efficiency gains across the value chain – procurement. transparency.
Positively seen by customers.
Promoting Human rights
Business partner of choice
Minimized litigation
Attractive to investors. regulators. regulators. regulators
Positively seen by customers. banks Attractive to financial markets
Positively seen by communities and NGOs Lower risk of noncompliance
Employees/ talent attracted by firm that is committed to the dignity of all. after-sales
Attractive to investors. accountability
Reduced cost of ambiguity Reduced litigation
Attractive to investors.Annexure
Annexure A : The Business Case for following the Guidelines for the Social Environmental and Economic Responsibilities for Business
Principle Revenue growth and market access
New customers Business partner of choice New customers Customer loyalty
Cost savings and productivity
Access to capital
Risk management/ license to operate
Human capital
Brand value/ reputation
1. media
2. The ability to function in the longterm is improved to being responsiven ess. NGOs.

Positively seen by customers. media
9.
Providing value to customer
New customers Customer loyalty
New markets brought into fold
Investors back a growing firm
Lower risk of consumer action
Talent will be drawn towards growing firm
Customers perceive brand and firm favourably
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.
Supporting inclusive development
New customers Market expansion Innovative thinking stimulated
Newer sources of funding such as social venture funds
Enhanced governmental support to initiatives -cordial relations with stakeholders conducive for business growth. regulators Lower risk of noncompliance
Talent is drawn to the firm due to its commitment to the wellbeing of the planet. regulators. regulators. regulators. media
8. local governments. New models will emerge to impact cost savings
Attractive to investors.
Protecting the Environment
Business partner of choice Sustainabilit y oriented buyers will prefer to deal with organization Growth stimulated due to openness and trust
Lower operating costs in the long term Less danger of “externalities” emerging as liabilities. Blunt the possibility of others using policy to stymie business. NGOs.
Potential source of trained employees
Positively seen by customers.
Positively seen by customers. banks Attractive to financial markets
Positively seen by communities.6.
Responsible policy advocacy
Openness will attract investors committed to good governance
Positively seen by civil society
People drawn to work for an open firm. media
7.

Department of Public Enterprises 10. Draft Indian Standard on Guidance on Good Governance by Bureau of Indian Standards 7. Stakeholder Engagement: A Good Practice Handbook for Companies Doing Business in Emerging Markets by IFC 21. Final Draft ISO 26000: International Standard 8. Global Reporting Initiative (GRI) G3 Guidelines 9. “Developing Value” by Sustainability and IFC.
. Indian Companies with Solutions that the World Needs: Sustainability as a Driver for Innovation and Profit by WWF and CII-ITC CESD 12. Constitution of India 4. Social Code for Business by UNDP and CII 20. Corporate Action Plan on Climate Change by TERI BCSD India 5. 2007 by Government of India. Public Sector Roles in Strengthening Corporate Social Responsibility by The World Bank 18. Social & Cultural Rights 13. Universal Declaration of Human Rights 24. Prime Minister's 10 Point Charter 16. Towards Responsible Lobbying : Leadership and Public Policy by Accountability and the Global Compact 23. Meeting Changing Expectations: Corporate Social Responsibility by WBCSD 14. Guidelines on CSR for Public Sector Undertakings: March 2010 11. Ministry of Heavy Industries and Public Enterprises. Proposed Concrete Steps by Indian Industry on Affirmative Action for Scheduled Castes & Scheduled Tribes: A CII-ASSOCHAM Action Plan 17.Annexure B: Resources Agenda for Affirmative Action by FICCI Business and the Millennium Development Goals: A Framework of Action by IBLF 3. Strengthening Implementation of Corporate Social Responsibility in Global Supply Chains by IFC 22. Guidelines on Corporate Governance for Central Public Sector Enterprises. International Covenants on Civil & Political Rights and Economic. Corporate Responsibility: Private Initiatives and Public Goals by OECD 6.
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1. Reports of the UN Special Representative on Business and Human Rights 19. 2. National Action Plan on Climate Change 15.

com/wiki/A_Definition_for_Business_Ethics
2 Transparency: It is defined as openness about decisions and activities that affect society. and being accountable to internal and external stakeholders so as to provide a balanced and reasonable representation of performance. or individual representing a company. actions and conduct within a business in the context of a particular situation and is consistent with accepted norms of behaviour Adapted from Final Draft ISO 26000 and http://business. Adapted from GRI G3 Guidelines 5 Stakeholder: Individual or group concerned or interested with or impacted by the activities of the businesses and vice-versa. • The company was or should have been aware that its action or omission could provide such help. the environment and the economy and the willingness of businesses to communicate information in clear.pgaframework. how it operates to achieve its objectives and how stakeholders have their say in the processes. accurate. honest timely and complete manner. that 'helps' (facilitates. etc. Adapted from IS 16001:2007 6 Governance: Governance concerns itself with "how" an organization makes decisions. Adapted Competition Commission of India 9 Disclosure: Disclosure is the practice of measuring. Adapted from IS 16001:2007 4 Disclosure: Disclosure is the practice of measuring. now or in the future. Adapted from GRI G3 Guidelines 10 Complicity: Complicity refers to involvement of the business in violations of any of the principles and core elements by third parties connected with its operations.) another. beneficial or silent. encourages. • Complicity may be direct. assists. It is generally made up of the following elements: 1
• An action or omission (failure to act) by a company. in some way. Adapted from “Unchaining Value” Published by SustainAbility 8 Anti-competition: Actions that cause or are likely to cause appreciable adverse effects on free and fair competition within a country. It is the process that ensures that business goals are pursued without compromising any of the three elements. e-learning module Sustainability: The outcome achieved by balancing the social.org/pgaframework_pgadiagnostic. reporting.Suggested Description and Explanation of Terms
Ethical Behaviour: individual or collective behaviour that is in accordance with accepted written and / or unwritten codes of principles and values that govern decisions. to perpetrate a violation.asp 7 Value Chain: Value chain refers to both the supply chain (described above) as well as the value created by the distributed channel for end use customers. Adapted from http://www. reporting. legitimises. environmental and economic impacts of business. and being accountable to internal and external stakeholders so as to provide a balanced and reasonable representation of performance. Adapted from the United Nations High Commissioner for Human Rights.lovetoknow.Annexure D: Endnotes. 3 Accountability: Principle that organizations are responsible for their actions and may be required to explain them to others. 45
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software. images. distribution and transportation. Adapted from www. spiritual. flora. ecological. and symbols. These aspects of sustainable consumption provide Guidelines on how to reduce the social and ecological impacts of what we consume. There are two types of home based work 1) independent employers or own account workers (purely self employed) and 2) dependent sub-contract workers.com
16 Traditional Knowledge: This refers to any indigenous technical. Adapted from World Intellectual Property Organisation
18 Sustainable consumption: The definition proposed by the 1994 Oslo Symposium on Sustainable Consumption defines it as "the use of services and related products which respond to basic needs and bring a better quality of life while minimising the use of natural resources and toxic materials as well as emissions of waste and pollutants over the life cycle of the service or product so as not to jeopardise the needs of future generations.investorword. literary. social. and designs used in commerce. human rights and political dimensions of sustainability in the production and consumption process. recreation and leisure time and social belonging. Adapted from Final Draft ISO 26000
14 Customer: A person or business that buys goods or services produced by another person or business. land. for carrying out activities of the organization or any part thereof. healthy and prosperous. musical and artistic works. incidental to or connected with those activities. Well being is synonymously used with good quality of life 20 Employee: A person employed. physical and mental health. natural resources. names. Typical examples include antiseptic properties of neem. water. it refers to all activities and processes from the design to delivery. etc. fauna. geographic indications and trade secrets.” Adapted from IS 16001:2007
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Home based work: refers to any work that is done by individuals from their place of residence. These include not only the ecological impacts of what we buy but also the equity. such as inventions. use and reuse. etc. for which the IP owners are granted certain exclusive rights under the corresponding national IP laws. It also includes the user of the product or service other than the buyer. Adapted from www. It includes indicators of wealth and employment. In the case of services. outer space and their interrelationships. including air. in pursuance of the organization's stated objectives. industrial designs. trademarks. Adapted from Oslo Symposium 19 Well-being: Is a state of being happy. Common types of IP include patents (inventions). Adapted from report of National Commission on Enterprises in the Unorganized Sector 46
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. turmeric. whether for remuneration or not.12 Product Life Cycle: This refers to all the stages of a product from extraction or acquisition of raw materials through manufacturing and processing." Sustainable consumption asks us to consider issues that go beyond the individual when we shop.investorword. Adapted from World Business Council for Sustainable Development
Environment: Natural surroundings in which an organization operates.com
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Consumer: A person or business that buys products or services for personal use rather than for resale or use in production and manufacture. built environment. education.com
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Intellectual Property: refers to creations of the mind. Adapted from www. medical or cultural knowledge which is not necessarily documented but is in use by or generally known to communities. people. recycling and disposal. emotional.legalserviceindia. scientific. directly or by or through any agency (including a contractor). copyrights. NOTE Surroundings in this context extend from within an organization to the global system.

ISO 26000 23 Participation of workers: Situation where workers are involved in some way with decision-making in a business organization.epaw.html
26 Work-life balance: Work-life balance is a broad concept including proper balancing "work" (career and ambition) on one hand and "life" (pleasure. geographic or health circumstances. migrant workers 47
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Harassment: Harassment covers a wide range of offensive behaviour that is unwanted by the recipient and which the perpetuator knows or ought to know is threatening or disturbing. though broader.uk/csr/grievance. economic. terms include "lifestyle balance" and "life balance". Adapted from http://www. Workers can be organized in quality circles and meet regularly in small groups to discuss ways in which their work could be better organized. political. Related. leisure.co.co.org/wiki/Work%E2%80%93life_balance 27 Fair Living wages: A wage sufficient for a family to meet its basic needs and which provides some ability to deal with emergencies.html
Collective Bargaining: Negotiating between the employees organization and employer's organization / management in good faith with a view to agree on terms and conditions of work and / or settlement of disputes and grievances of employees represented by a representative body of employees Adapted from Indian Act Trade Unio\n Act 1926
25 Grievance Mechanism: Mechanism for any stakeholder individually or collectively to raise and resolve reasonable concerns affecting them without impeding access to other judicial or administrative remedies. have the right to establish and. mental. without distinction whatsoever. to join organizations of their own choosing without previous authorization. Adapted from www.wikipedia. Adapted from http://en. cultural. subject only to the rules of the organization concerned. These groups in India include: • • • • • Women and girls People with disabilities Children Tribals Migrants. transparent and have independent governance structures. The mechanism should be:
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o Clear. family and spiritual development) on the other. Worker participation can take many forms.uk/reference/encyclopaedia/hutchinson/m0038239. o Accessible o Predictable o Equitable o Based on dialogue and mediation Adapted from Final Draft ISO 26000 and www. There might be a consultative council in the company where trade unions and management meet regularly to discuss points of mutual interest. Work Place: Place(s) where activities of the organization are carried out in pursuance of its stated objectives Adapted from IS 16001:2007 Vulnerable and Marginalised Groups: Group of individuals who are unable to realize their rights or enjoy opportunities due to adverse physical.22 Freedom of Association: Workers and employers. social.businessdictionary. Adapted from Final Draft.

The document also said that “after considering the experience of the adoption of these Guidelines by the Indian corporate sector and consideration of relevant feedback and other related issues. which would be offered to enterprises for voluntary adoption • To constantly check for wide applicability across all enterprises irrespective of their size and that Guidelines serve to ultimately enhance the performance of businesses in the unique Indian context. UNGC. an advisory body formed in July 2008 within the framework of the bilateral cooperation project on CSR between IICA and GIZ. PSU CSR Guidelines. constituted in April 2009 and notified in November 2009 by the Indian Institute of Corporate Affairs. OECD Guidelines in as much as they help to address Indian particularities as well as national resources like the BIS standard 16000.the final day of the Corporate India Week . Through these Guidelines. was accordingly tasked with the 'review and elaboration' of the Guidelines. Pratibha Patil on 21 December 2009 . the Government may initiate the exercise for review of these Guidelines and further improvement after one year. The Guidelines Drafting Committee (GDC). • To draw insights from good practices and international norms and frameworks such as ISO 26000. The GDC was specifically tasked with the following objectives Mandate of the GDC •· To formulate a draft framework guideline for social. the Ministry urged the business sector to adopt the principles contained in the Guidelines for responsible business practices. industry (practitioners and chambers/associations) and civil society. environmental and ethical responsibilities of business. and other sources • Specifically ensure that the framework addresses the concerns of Inclusive Development and Sustainability
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. It comprises representatives from government bodies.organized by the Ministry of Corporate Affairs. GRI. The GDC has its genesis in the Expert Group.Background Note on the Process Adopted in Drafting the Guidelines The National Voluntary CSR Guidelines were released by the Honorable President of India. Smt.

greater specificity. The draft was submitted to the IICA in the first week of August. Ms.
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. The feedback pointed out the need to include a special section on MSMEs. Harsh Jaitli (VANI). consistency. broad level operational guidance for implementation of the principles and their core elements.Vikas Goswami (Microsoft). Mumbai and Calcutta with business and civil society in separate discussions with each constituency. the GDC formed eight Working Groups to review the eight principles. Seema Arora (CII). Viraf Mehta (Permanent Invitee) and Ms. Arora (MCA/IICA). indicators for implementation. Bharat Wakhlu (Tata Services) are: Sh. while Working Groups met independently and fed into the GDC discussions. The Anchor Team coordinated the information flow to the GDC and to the Working Groups besides providing research inputs and creating guidance templates for the GDC. Anil Bharadwaj (FISME). management processes and compilation of good practice examples to demonstrate application of principles was developed by the Anchor Team to support the GDC. the GDC met 10 times in plenary. Ms. Sh. The feedback also indicated an overall consensus on the structure and the content of the GDC draft. Manoj K. Ministry of Corporate Affairs and his senior team. Stakeholder Consultations The stakeholder consultations were held through the months of March . and drafts were finalized in the GDC plenaries after long and intense deliberations. In addition. Bangalore. Review of 2009 Guidelines and Formulation of 2011 Guidelines The first review process was structured around the feedback received in March 2010. the GDC deemed it necessary to provide a glossary of terms and resources as part of the annexure to the Guidelines. between April and July.September in Delhi. A consultation was also held on 16 August 2010 with the Secretary. Annapurna Vancheswaran (TERI). Sh.GDC Members The names of the members of the GDC headed by Sh. clarity and value-neutrality in terms used in the Guidelines document. The revised draft contained an additional ninth principle. Sh. Dinesh Agrawal (NTPC). Responsibilities for other sections/additions like Management processes. Sh. Shankar Venkateswaran (Sustainability). relevance for MSME were also divided amongst the members. Sh. In all. To incorporate the feedback. Sh. Ms. Neha Kumar (GIZ). which met in plenary sessions where the GDC deliberated on each principle. Guidance on elaboration of principles. Paresh Tewary (FICCI).

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. responsible business and development were received. Detailed comments from nearly 200 stakeholders. Suggestions were also sought on the various strategies to stimulate the adoption of the Guidelines. compiled. Presentation to MCA The GDC presented the final draft to the Ministry of Corporate Affairs through the IICA on 3 November for its due consideration by the Ministry for the purpose of release during the 2010 Corporate India Week. Incorporation of feedback Nearly 2000 comments received from stakeholders were collated.The feedback was collected on technical and substantive aspects of the Guidelines as well as on the flow. if it filled a technical gap. During November. analysed and considered by the GDC on the basis of the following criteria: if the suggestion aids comprehension . if the feedback also represented majority view from stakeholder consultations. comprising enterprises. national and international NGOs active in the field of sustainability. 2010 – May 2011 meetings were also held with MCA to discuss the way forward. government agencies. if it would also aid implementation of the Guidelines and if it is material to business The GDC will share the report of consultations with the all stakeholders participating in the consultative process. industry associations and chambers. both large and from SME sectors. clarity and usage of language.